Daily Morning Report

Thursday, December 13–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

European stock markets were mostly weaker overnight. Asian stock indexes were mostly firmer. U.S. stock indexes are pointed toward higher openings when the New York day session begins. World equity markets have been assuaged this week by the perceived progress between the U.S. and China in their trade talks. Reports say China is making somewhat significant changes to come into line with U.S. demands.

The marketplace will be watching the conclusion of the meeting of the European Central Bank, which is presently in progress. The ECB is expected to today announce the end of its quantitative easing of monetary policy. As always, the markets will closely scrutinize ECB President Mario Draghi’s press conference after the meeting, to see if he tips his hand on future ECB policy direction.

Brexit turmoil was kicked up a notch earlier this week, but U.K. Prime Minister Theresa May survived a no-confidence vote from members of Parliament late Wednesday, to ease just a bit the uncertainty on the matter. Most global markets are not being significantly impacted by the political turmoil in the U.K. surrounding Brexit.

The key outside markets early today find the U.S. dollar index slightly lower on a corrective pullback from recent solid gains that pushed the index to a new for-the-move high Tuesday. Meantime, Nymex crude oil prices are slightly down and trading around $51.00 a barrel.

U.S. economic data due for release Thursday is light and includes the weekly jobless claims report, and import and export prices.

–Jim

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Wednesday, December 12–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly higher overnight as global traders and investors chose to focus on improving prospects for a U.S.-China trade deal, instead of the uncertainty of leadership of the United Kingdom. U.S. stock indexes are pointed toward higher openings when the New York day session begins. Trading in the U.S. stock indexes has been volatile this week, with many stock market experts saying to expect this to be the norm for at least a while.

The present U.S.-China trade negotiations are so far producing tangible results, according to reports coming from both nations. Officials from both sides appear to be upbeat on the progress. The marketplace reckons that if the world’s two largest economies come to terms on trade, the spillover effect would be positive for most world economies.

Brexit turmoil has been kicked up a notch at mid-week, as U.K. Prime Minister Theresa May will face a no-confidence vote from members of Parliament today. May on Monday called off a vote on her Brexit plan, which most reckoned would be defeated anyway. She has quickly lost popularity in the U.K. public eye and among members of Parliament. However, most global markets are not being significantly impacted by the political turmoil in the U.K.

The key U.S. economic data point of the week, the consumer price index for November, is due out shortly. CPI is forecast at unchanged from October. Recent U.S. inflation reports have shown very tame inflation, after data released earlier this year raised some concern regarding rising inflation becoming problematic.

The key outside markets early today find the U.S. dollar index slightly lower on a corrective pullback from recent solid gains that pushed the index to a new for-the-move high Tuesday. Meantime, Nymex crude oil prices are higher on a corrective bounce. There are still no early technical clues the crude oil market is close to a bottom.

Other U.S. economic data due for release Wednesday includes the weekly MBA mortgage applications survey, real earnings, the monthly Treasury budget statement and the weekly DOE liquid energy stocks report.

–Jim

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The gold market has seen its technical posture improve markedly recently, as prices this week hit a nearly five-month high. See on the daily bar chart that prices are in a choppy uptrend. The bulls have the near-term technical advantage, which means the path of least resistance for prices will remain sideways to higher. Stay tuned!

Tuesday, December 11–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly higher overnight. U.S. stock indexes are pointed toward higher openings when the New York day session begins, following a big rebound Monday afternoon from steep losses seen in the morning.

The world marketplace was encouraged that a high-level telephone call took place Monday between trade officials of the U.S. and Chinese government. The two sides have until March 1 to reach a trade deal, or the U.S. has threatened to levy more trade penalties against China.

Brexit turmoil and uncertainty regarding when and how the U.K. will depart the European Union still have European stock and financial markets a bit unsettled. Prime minister Theresa May Monday called off Tuesday’s vote on her Brexit plan, which most reckoned would be voted down anyway. The Euro currency and British pound sunk on the news, and the U.S. dollar index rallied.

Gold prices hit a nearly five-month high overnight, partly on safe-haven demand from Europeans over the Brexit uncertainty, and also on more bullish charts supporting technically based buying interest.

In other overnight news, Indian stock and financial markets gyrated after India’s central bank chief abruptly quit. The Indian rupee dropped sharply on the news.

The key outside markets today find the U.S. dollar index lower on a corrective pullback from solid gains posted Monday. Meantime, Nymex crude oil prices are modestly up after selling pressure seen Monday. There are still no early technical clues the crude oil market is close to a bottom.

U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, and the producer price index.

–Jim

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Monday, December 10–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly lower overnight. U.S. stock indexes are pointed toward slightly weaker openings when the New York day session begins. Shaky U.S.-China trade talk prospects and new documents released late last week more strongly suggesting very high-level Trump presidential campaign staffers colluded with Russia have traders and investors uneasy to start the trading week.

Meantime, Brexit turmoil and uncertainty regarding when and how the U.K. will depart the European Union have European stock and financial markets unsettled. The U.K. Parliament on Tuesday will vote on an exit plan proposed by Prime Minister May, which is expected to be rejected.

In overnight news, the latest official Chinese trade data showed the world’s second-largest economy continuing to slow down in its rate of growth, as total exports were up a much-lower-than-expected 5.4% in November, year-on-year—and at an eight-month low. Imports also missed expectations significantly and were up only 3.0% in the same period, versus up 21.4% in October.

The key outside markets today find the U.S. dollar index firmer. Meantime, Nymex crude oil prices are lower and trading around $51.86.

U.S. economic data due for release Monday is light and includes the employment trends index.

–Jim

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The U.S. Treasury bond futures market this week saw prices hit a three-month high, amid a double-barrel does of bullish fundamental news: flight-to-quality buying as U.S.-China tensions may be escalating, and buying interest on notions of a more dovish U.S. Federal Reserve. The bond and note market bulls are in firm technical control, to suggest sideways to higher price action for at least the near term. Keep reading my daily market reports for those early chart clues on potential near-term price trend changes in the markets you are following. Stay tuned!